T-Mobile Merger With Sprint Will Cause Price Hikes, Poorer Service, Advocates Say

T-Mobile's proposed $26 billion acquisition of Sprint will result in higher prices for consumers, poorer service and fewer incentives for the companies to invest, a coalition of advocacy groups is telling the Federal Communications Commission.

“As structured, the T-Mobile-Sprint combination is illegal on its face under the antitrust laws, does not serve the public interest, and should be rejected,” Public Knowledge, Open Markets Institute, Common Cause, Consumers Union and Writers Guild of America, West write in comments submitted this week to the agency.

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The groups are weighing in on T-Mobile's bid to purchase Sprint -- a deal that would leave the country with only three major mobile wireless carriers, all of which are roughly the same size. T-Mobile and Sprint combined have around 100 million wireless customers, while Verizon has roughly 116 million and AT&T has around 93 million.

T-Mobile and Sprint say that if the merger goes through, they plan to invest nearly $40 billion to roll out a nationwide 5G network. T-Mobile and Sprint argue that the new network will offer 5G speeds four to six times faster than each company could achieve independently, which will spur competition by forcing Verizon and AT&T to improve their own networks.

But the advocacy groups say the market will be more competitive with four companies than three. They point to T-Mobile's growth since 2011, when the government blocked its proposed merger with AT&T. “Given T-Mobile’s impressive track record of doubling its customer base, deploying a 4G LTE network, building a best-in-class customer service team, and introducing pro-consumer and innovative pricing and service plans, it appears that acquiring Sprint is unnecessary for T-Mobile to continue driving innovation and competition in the wireless market,” the advocacy groups write.

The FCC isn't the only agency weighing in on the merger.  State attorneys general also could play a role in deciding whether the deal is approved. In New York, Acting Attorney General Barbara Underwood is concerned the companies may raise prices on their less expensive prepaid plans if the merger goes through, according to The New York Post.

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